For the moment, the split between TV networks and affiliate owners (or at least those controlling the NAB) is complete. With accusations of hijacking and jihad against the large station-group owners, ABC pulled out of NAB last week.
We say "for the moment" because this has happened before. In November 1992, ABC announced its exit over NAB opposition to broadcast/cable crossownership and must-carry.
We have a hard time blaming ABC for the repeat performance. We believe Disney/ABC's Preston Padden when he says his company's abrupt departure from NAB had less to do with the 35% cap on TV-station ownership (the networks want to raise it; the affiliates and affiliate-controlled NAB do not) and more to do with a principle. That principle is that the NAB should not attack one segment of its membership for the benefit of another, or, as Padden more colorfully puts it, "Thou shalt not use the NAB to screw thy fellow broadcaster." The radio members adhere to that commandment. A lot of them would like to see Clear Channel brought down a rung or two, but none of them is talking about sending the NAB to the FCC or Capitol Hill to impose new radio-ownership restrictions.
Sticking to the principle will not always be possible, and it means NAB will have to sit out some big issues, as it did the monumental battle over fin-syn a decade ago. But it's better to narrow the scope of NAB's duties than to lose powerful members.
The affiliates have legitimate concerns about the growing power of the networks. The networks do encroach on the programming prerogatives of their affiliates, and, under the newly liberalized rules, the networks pretty much have the right of first refusal to any network-affiliate station that comes on the market. What's more, in some cases, they can target affiliates for acquisition and threaten loss of affiliation if they don't sell.
Still, the affiliates' complaints are better expressed and prosecuted through their own group, NASA, than through the NAB. In this latest go-round on ownership rules, the affiliates put the NAB staff in a tough position. The association's support for retaining the 35% cap while simultaneously pushing for eliminating local-ownership caps and the ban on newspaper/broadcast crossownership smacks of a self-serving schizophrenia.
Like Padden, we thought that, after the June 2 vote, NAB President Eddie Fritts could start reassembling his association. There is much for a united broadcasting industry to do. Cable operators are mobilizing. Not only are they prepared to oppose full digital must-carry, but they are also launching attacks on retransmission-consent rights. Several major operators were demanding that Rupert Murdoch waive his retransmission-consent rights as a condition of winning government approval of his DirecTV deal.
At last week's hearing on that deal, one Wall Street type praised Murdoch for his business acumen, suggesting that he was simply switching from the glue horse of over-the-air TV to the thoroughbred of DBS. Combating that perception, much less the potential reality, will take an industry united by its strengths and common goals, not divided against itself.